MARKETS SPECTATOR: What price gold?

Peter Thompson’s forecast for the gold price is as wide as the Kazakh plains. 

The managing director of Central Asia Resources, which has four mines in Kazakhstan, says the spot price for the metal could fall as low as $US1,100 a troy ounce yet quite easily go as high as $US1,700 an ounce. He cites Europe’s deep economic recession and concerns over the integrity of the Euro, Syria’s two-year old civil war, North Korean missile tests and questions over the sustainability of the US economic recovery as factors behind a potential rise in the gold price.

Central Asian Resources has deposits that have an indicated and inferred a resource total of 1,285,000 ounces. Thompson, who has been in the mining game for more than two decades, says selling the gold from the Kazakh mine is never a problem. A suitcase full of cathode gold is simply carried onto an aircraft bound for Switzerland where a buyer takes delivery.

“Gold is the most liquid of the metals markets.” Thompson says.

Central Asian Resources' total cash costs are $US950 an ounce. At about $US1,300 an ounce, Thompson says the current price is  “a good market for us”. The company hopes to start mining in June and is seeking to raise $5 million from shareholders to fund its operations.